HMO Licence vs Planning Permission: You Might Need Both

One of the most common misconceptions we encounter is landlords assuming that an HMO licence covers everything they need to legally operate a shared property. It doesn't. Licensing and planning permission are entirely separate legal regimes, administered by different departments within the same council, and you can be fully compliant with one while breaching the other. Understanding where the boundary between the two sits — and where they can silently diverge — matters just as much as getting either one right in isolation.

Two different questions

An HMO licence answers the question: is this property being managed and maintained to an acceptable standard for the number of people living in it? It looks at gas and electrical safety, room sizes, fire precautions, waste arrangements and the suitability of the person managing the property. Planning permission answers a completely different question: is this property legally allowed to be used in this way at all, under the Town and Country Planning regime? One is about condition and management; the other is about lawful use. A property can score perfectly on the first while having never resolved the second.

Permitted development and Article 4 Directions

Smaller HMOs — generally 3 to 6 unrelated occupants sharing amenities, classified as use class C4 — can often be created from an ordinary family home, use class C3, under permitted development rights, without needing a specific planning application. This is the default position across much of England: converting a single dwelling into a small shared house is treated as a use so similar to ordinary residential use that no separate permission is required.

However, many London boroughs have removed this permitted development right entirely within some or all of their area, via what's called an Article 4 Direction. Where a Direction applies, full planning permission is required for the same C3-to-C4 conversion that would be automatic elsewhere, and operating the conversion without it is a planning breach even though nothing about the physical property has changed. Article 4 Directions are set at borough level and sometimes only cover specific wards or conservation areas within a borough, so the same conversion can be permitted development on one street and require full planning permission a few streets away.

Larger HMOs need planning permission regardless

For larger HMOs — generally 7 or more occupants, classified as a sui generis use — planning permission is required in every borough, Article 4 Direction or not. Permitted development rights never extend this far, because a sui generis use has no equivalent default classification to fall back on. If you're licensing a property under the mandatory scheme, which itself only applies from 5 occupants and 2 households upward, it's worth checking early whether the occupancy level also tips the property into sui generis territory for planning purposes, since the mandatory licensing threshold and the planning threshold don't align at the same headcount.

Why this catches out even experienced landlords

A landlord can secure a fully valid HMO licence — the council assesses the licence application on management and property standards — without anyone flagging that the underlying use of the property was never lawfully established under planning law. The two departments don't always cross-check each other automatically when processing a licence application, so a property can sit in this gap for years before an issue surfaces, typically at sale, during a mortgage or insurance review, or during an unrelated council enquiry such as a neighbour complaint that brings a planning officer to the property for the first time.

The risk compounds because a licence renewal doesn't re-open the planning question either. A property can be re-licensed multiple times over a decade with an unresolved planning breach sitting underneath it the entire time, only for the issue to surface at the least convenient moment — typically when a buyer's solicitor raises it during conveyancing.

What to check before you convert or buy

If you're converting a property into an HMO, confirm the current planning use class of the property and whether an Article 4 Direction applies to that specific address before you start, not after tenants have moved in. If you're buying a property that's already operating as an HMO, ask the seller for evidence that planning permission was obtained where required, rather than assuming a long-standing letting history proves lawfulness — enforcement action against an unauthorised change of use can, in some circumstances, still be taken years after the change occurred if it wasn't done openly.

Check both before you commit

If you're converting a property into an HMO, or buying one that's already operating as such, verify the planning position — specifically whether an Article 4 Direction applies in that borough — alongside the licensing position. They are not the same question, and passing one tells you nothing about the other. Contact us and we can point you toward the right planning guidance for your specific borough alongside handling your licence application, whether that's an Additional HMO Licence at £300+VAT or a Mandatory HMO Licence at £500+VAT.